China’s private firms still face ‘hidden barriers’ that state-owned brethren do not, official media warns

Factors hampering the development of private businesses include diminished financing and fewer opportunities than China’s state firms receive, according to a state media editorial

Questions linger as to how and whether Beijing’s announced measures will be effectively implemented, rather than serve as mere lip service

Reading Time:2 minutes

China’s private firms face a more hostile operating environment than their state-owned counterparts, according to a new state-media editorial. Photo: Bloomberg

Published: 9:30pm, 18 Sep 2023

Chinese state media has flagged “hidden barriers” faced by the struggling private economy, after private investment continued falling last month amid weak confidence.

The recognition of such barriers – which generally refer to the uneven playing field with state-owned players, in terms of financing and market access – came as Beijing’s 31-point action plan, released in July, has failed to reverse market expectations.

“Hidden barriers exist in many fields of business activities and accompany the entire process of private enterprise growth,” said an editorial published on Monday by the Study Times, a journal by the Central Party School.

“Inequality of rights, opportunities and rules, as well as their treatment when compared with state-owned enterprises (SOEs),” have also hampered the development of private firms, it said.

The muddied relationship between government and business, unfair market access, and stiff competition have also served to compound the hurdles facing private firms, the editorial added.

Select Voice

Choose your listening speed

Get through articles 2x faster

1.25x

250 WPM

Slow

Average

Fast

00:0000:00

1.25x